A northwesterly migration of Thais from their region of origin in northwestern Tonkin had brought to the Ta-li region (in what is present-day Yunnan, China) a successor state to the Ai Lao kingdom In the seventh century.

This new kingdom, Nanzhao, expands its power by controlling major trading routes, notably the southern Silk Road.

Culturally, this polyethnic, hierarchical, and militarized state is to have a great influence on later societies in Indochina, transmitting the Tantric Buddhism of Bengal to Laos, Thailand, the Shan state, and possibly Cambodia, as well as the political ideology of the maharaja (protector of Buddhism).

Nanzhao is organized administratively into ten prefectures called kien.

This term seems to be the origin of place-names keng (for example, Kengtung), chiang (for example, Chiang Mai), and xiang (for example, Xiangkhoang).

Moreover, the population and army of Nanzhao are organized in units of 100, 1,000, and 10,000, a form later found in Indochina.

Also, the title chao (prince) appears to have been of Nanzhao origin.

Another branch of this same migration begins at the headwaters of the Nam Ou and follows it downstream to Louangphrabang, continuing on through Xaignabouri to Chiang Mai.